Keena v Promontoria (Aran Ltd) and Others

• Jurisdiction: Ireland
• Court: Court of Appeal (Ireland)
• Judge: Ms. Justice Whelan
• Judgment Date: 21 December 2023
• Neutral Citation: [2023] IECA 319
• Docket Number: Court of Appeal Record Number: 2019/ 95

Between/

Maria Keena

Appellant

and

Thomas Coughlan and Raymond Donovan and Michael Dempsey and Promontoria (Aran) Limited and Luke Charleton and By Order Seamus Walsh and By Further Order Kilkenny Walsh Limited

Respondents

[2023] IECA 319

Murray J.

Collins J.

Whelan J.

Court of Appeal Record Number: 2019/ 95

THE COURT OF APPEAL

Specific performance – Contract for sale – Prima facie case – Appellant seeking costs – Whether a stay ought to be granted to the respondents in respect of an order for costs being made against them in favour of the appellant

Facts: The appellant, Ms Keena, appealed to the Court of Appeal against the judgment and order made by Quinn J in the High Court on the 8th February, 2019, wherein at the conclusion of the appellant’s case claiming entitlement to a decree of specific performance of a contract for sale of the Ard Rí Hotel Waterford (the premises) (together with ancillary declaratory relief and damages in lieu of specific performance) as against the fourth and fifth respondents, he acceded to an application made on behalf of the fourth, fifth, sixth and seventh respondents, Promontoria (Aran) Ltd, Mr Charleton, Mr Walsh and Kilkenny Walsh Ltd, for an order dismissing the proceedings by direction on the basis that the appellant had failed to establish a prima facie case. The appellant essentially contended that the trial judge erred, inter alia, in the application of the test for a motion to dismiss on the basis of no case to answer. A judgment was delivered in the Court of Appeal allowing the appellant’s appeal: [2023] IECA 249. The Court of Appeal set aside the order of the High Court and directed that the trial resume and proceed at the convenience of the High Court. The fourth and fifth respondents did not take issue with the provisional view of the Court of Appeal that the appellant was entitled to her costs of the appeal. It was submitted that the said order should be stayed pending the determination of the substantive proceedings before the High Court “or, at the very least, stayed as to execution”. The sixth and seventh respondents likewise sought a stay of the costs order until after the conclusion of the High Court proceedings. The appellant contended that no reason was identified to warrant imposing a stay on costs.

Held by Whelan J that the court in determining whether to grant or refuse a stay pending the conclusion of the resumed hearing should have regard, where appropriate, to ensuring that the operation of the order as to costs accords with “a regime which minimises the overall risk of injustice” as referred to by Clarke J in Okunade v Minister for Justice & Another [2012] 3 IR 152 at para. 67. Whelan J noted that this principle as reiterated by the Supreme Court in Dowling v Minister for Finance [2013] IESC 37 had been adopted and applied in the Court of Appeal in McDonald v Conroy [2020] IECA 336 at para. 50; that case involved a rehearing of the substantive action which had already concluded in the High Court. Whelan J held that this was a material distinction; in this case the matter had been remitted and would resume expeditiously. Whelan J noted that there was no suggestion of impecuniosity on the part of the respondents or any of them nor was it asserted that the refusal of a stay would compromise or adversely impact on their respective ability to defend the proceedings in accordance with the defences delivered on their behalf and in accordance with the evidence extensively referred to in the course of the cross-examination of the appellant and her witnesses as being intended to be adduced on their behalf at the resumption of the hearing.

Whelan J held that in light of s. 168 and 169 of the Legal Services Regulation Act 2015, and the Rules of the Superior Courts, including O. 99, r. 2(3), the appellant was entitled to her costs of the appeal. Whelan J held that no valid basis had been identified by the respondents for the granting of a stay in respect of same. Whelan J refused the stay sought.

Costs awarded to appellant.

UNAPPROVED

JUDGMENT of Ms. Justice Whelan delivered on the 21st day of December 2023

Introduction

1 . This judgment is directed towards whether a stay ought to be granted to the respondents in respect of an order for costs being made against them in favour of the appellant arising from the judgment [2023] IECA 249 delivered in this Court allowing the appellant's appeal. This Court set aside the order of the High Court brought on foot of an application by the fourth to seventh respondents which had successfully sought dismissal of her proceedings by direction on the basis that she had failed to establish a prima facie case. This Court directed that the trial resume and proceed at the convenience of the High Court.

2 . This Court's provisional view was that the appellant, having been entirely successful in her appeal, was entitled to the costs of her appeal in this Court. With regard to the costs incurred to date in respect of the unsuccessful application to the High Court, this Court expressed the view that such costs ought to be determined by the judge in the High Court at the conclusion of the hearing and no order was proposed to be made in respect of same.

Position of fourth and fifth respondents

3 . The fourth and fifth respondents do not take issue with the provisional view of this court that the appellant is entitled to her costs of the appeal. It is submitted, however, that the said order should be stayed pending the determination of the substantive proceedings before the High Court “…or, at the very least, stayed as to execution”. Three specific bases were identified in support of the stay application. Firstly, since the substantive action now has to resume before the High Court and its ultimate conclusion is uncertain, the various potential outcomes include the possibility that the appellant's proceedings might be dismissed with an order for costs against her. In such a scenario the order for costs in her favour this appeal would “… properly be set off against the costs of the appeal”. Thus, it was contended, it would be both premature and unfair that she obtain payment of her costs in respect of this appeal prior to the conclusion of same. Reliance was placed on the decisions of this court in BGB Property Holdings Ltd. v. Tifco Ltd. [2021] IECA 181 and Promontoria (Oyster) DAC v. Kean [2023] IECA 181.

4 . Secondly, these respondents place reliance on the fact that this action was admitted into and will proceed in the Commercial List of the High Court. The general practice in that court is to grant stays on costs orders made in respect of applications brought during the course of the litigation. The approach is exemplified by the decision in HKR Middle East Architects Engineering LLC v. English [2021] IEHC 376 where, having made an order for costs in favour of the party who had successful resisted an interlocutory application, McDonald J. granted a stay on same “…pending the ultimate determination of these proceedings”. It was emphasised that the matter is listed in the Commercial List and has a prospect of been dealt with expeditiously. This was said to represent “a powerful consideration” in favour of a stay.

5 . Thirdly, it was emphasised that the appellant is not suggested to be impecunious. She had refused to accept the return of a money draft originally handed over by her. It was said to follow that in the circumstances it would be both just and convenient to place a stay on the appellant's order for costs of this appeal. Reliance was placed on the decision of Laffoy J. in Haughey v. Synnott [2012] IEHC 403 and also the decision of Humphrey J. in Havbell DAC v. Harris [2020] IEHC 147.

6 . Reliance was also placed on the decision of the Supreme Court in Cantrell v. Allied Irish Banks plc [2021] IESC 13 where the issue of a stay was said to have been influenced by the relevant proximity of the trial date.

Position of sixth and seventh respondents

7 . The sixth and seventh respondents likewise seek a stay of the costs order until after the conclusion of the High Court proceedings. They acknowledge the extensive recent jurisprudence and the import in same which confirms the principle that costs orders are generally immediately enforceable unless it is demonstrated to be in the interests of justice to grant a stay on execution of same. Where, as here, the final outcome of the substantive proceedings is not yet known it was urged that this court should seek to identify “a regime which minimises the overall risk of injustice”, placing reliance on the Supreme Court decision in Okunade v. Minister for Justice & Another [2012] 3 IR 152.

8 . Reliance was also placed on the decision of this Court in McDonald v. Conroy [2020] IECA 336, in circumstances where the matter was remitted to the High Court for rehearing, for the reasons stated in the judgment of Collins J. (with which the other members of the court concurred). A stay on execution of the costs order was granted pending conclusion of the retrial before the High Court which this court had directed.

9 . These respondents urge that it is in the interests of justice to grant a stay of execution on execution of the costs order in respect of the appeal pending conclusion of the High Court proceedings. It was urged that the facts and circumstances in this case are analogous to those which obtained in McDonald v. Conroy.

Arguments on behalf of the appellant

10 . It was contended that no reason was identified to warrant imposing a stay on costs. Accordingly, that the normal rules should apply and that costs follow the event.

11 . The appellant contests...